The Government Controls The Housing Market
The measuring stick of the economy has long been how the housing market if performing. When times are good houses are getting built, banks are loaning money, and families are buying homes. The economy is bad with homes are not being constructed, banks are not loaning out money, and families are not buying homes.
When houses are not being built there are a lot of people affected. People in construction are not hired and therefore they do not make money to support themselves or their families. Companies that sell material to build houses do not make money so they cannot hire more people.
The manufacturing companies that make the building materials go without orders and they have to lay off employees in their plants. Banks do not loan money to the banks keep interest rates up. With the higher cost of borrowing money people do not seek loans and this creates a situation that makes it hard for anyone to get a loan to buy a house.
It is a self defeating merry go round. Much of our economic situation is all about the home market. But as many real estate agent knows it has its ups and its down times. The government is very involved in the housing market. Many government regulations control the house market. The government for all intents and purposes controls everything from house construction to the money lending business that funds home purchases.
The government controls the bank who lends the money. The government controls the real estate broker who is involved in the home sale by setting the rules agents must adhere to. The government tries to encourage home sales by offering income tax credits to those who are first time home buyers. They encourage home buying by giving tax savings to home owners allowing them to write off on their income tax their interest payments.
This is an age old reason why people want to own a home, so they can pay less tax. We simply take for granted this benefit when in reality it is a major way government controls the home market. There are many factors involved in our economy but no other area is controlled or determined by the government than the housing market.
Maybe the government realizes that there is stability in house ownership. Of maybe the government realizes that if we own our homes we will be too busy to keep our homes and have to time to protest against the government. Or perhaps the government thinks that house ownership is the part of the happiness pursuit and all that.
No matter the reason the government and the housing market are the same thing. And if that is good or bad is all in how you look at it. The house market will always be up or down. It will always be a way for people to try to make a lot of money and will always be a way for people to simply buy a house and raise a family. And the government will forever be there controlling every step.
When you’re deciding to buy a house, some of the factors that you have to take into account are mortgage rates. As mortgage rates are important for home-buyers, rates GIC are important for investors. If you’re interested in a customized financial plan, remember to visit us.
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